In this article, I will describe the most common fee structures that buyers, advocates, and buyer agents around Australia charge their clients.
HOW TO FIND A TOP PERFORMING BUYERS AGENT
In 2016, there were only approximately 300 buyer agents and advocates in Australia. Fast-forward to 2024, and post-COVID, the rise of the Buyer Agent Industry has been significant. Today, there are approximately 1,800 in operation across all of the states.
We all offer very different levels of service, experience and results.
In my personal opinion, if you are looking to engage a professional buyer’s agent or buyer’s advocate to assist with one of the most significant financial decisions of your life, you should only employ a buyer agent who is a specialist in the area and type of property that you’re looking to buy.
HOW MUCH DOES A BUYER’S AGENT COST?
Around Australia, the majority of buyer agents and buyer advocates in our industry charge in two common ways. Below are examples based on your purchase price.
A PERCENTAGE BASED ON THE PURCHASE PRICE. (COMPLETE SERVICE)
The percentage-based model is very similar to how most of our country’s listing and selling agents work. However, this percentage-based option only works in our industry if the fee is fixed in advance or is scaled down.
Below is an example of what it looks like when we use a percentage-based fee.
Client Budget of $2,200,000 – $2,400,000
Property Purchase Price = $2,300,000
The purchase fee is 2%, including GST on the purchase price up $2,200,000
Total fee = $40,000 as we agreed to fix the fee in advance against the $2,000,000 price to ensure that we work for our client’s best interest.
A FLAT FEE BASED ON THE PURCHASE PRICE. (COMPLETE SERVICE)
The flat fee model is agreed to in advance. Again, as mentioned above, some selling agents charge a flat fee for their services.
Client Budget of $1,500,000 – $1,800,000
Property Purchase Price = $1,600,000
Total Buyers Agent fee = $20,000
Here are the three most common services a buyer’s agent or advocate will offer their clients.
This is a tailored end-to-end service where you sit back and work in collaboration. We do all of the heavy lifting for you so you can focus on what is most important to you, whether that be your family, your business, or your lifestyle. This service at Industry Insider is our most popular as it also offers access to a range of properties not advertised or listed on real estate websites.
This involves clarifying the best asset based on your borrowing capacity and family’s requirements. We will locate, evaluate, complete the due diligence and negotiate the best terms and purchase price on your behalf.
A second service many buyer agents offer is a negotiate-only service, where the buyer will assist with sourcing properties. Then, the buyer’s agent/advocate will use their years of negotiating skills and extensive network to produce a better result than you could if you were trying to buy the property yourself.
At Industry Insider Property, our end-to-end and negotiate-only services don’t require an upfront fee. This is because we are discerning with who we work and don’t take on a long list of clients. Our business is more of a quality-over-quantity model.
Be mindful that some buyer agents help 20+ clients a month. There can be a cross-over of briefs and price points, which can often lead to a conflict of interest. For example, which client is offered which property when you have two or more clients with similar budgets who wish to secure an investment property?
ARE BUYER’S AGENTS WORTH IT?
In the Buyer Agent Industry, you must understand the value that the buyer agent you’re considering hiring brings to the table. They should have refined their processes and negotiating skills over years of working in the industry. A top-performing buyer agent will say no to as many clients as they say yes to. This is because they understand they are specialists and value their time and experience. I often ask my potential clients, “If I can’t negotiate a fair fee for my services, how can you expect me to negotiate the best result for you when negotiating with the seller’s agent or auctioneer?
If you hire an experienced buyer’s agent, they will save you time, money, and stress, and the value they provide should cover their fees. At Industry Insider, more than 80% of our business is referral. This is an excellent sign as our clients keep returning and telling their friends and family about their experience.
Fun fact : Did you know that in the USA and Canada, 90% of people engage a buyer’s agent or buyer’s advocate to help with their property purchase?
If you DIY your property purchase, you are likely to either overpay or buy the wrong type of property, which can cause significant financial stress down the track.
Industry Insider Property is independent & committed to helping buyers & sellers achieve their desired outcomes. Our experienced buyer agents and advisors will guide, execute, and deliver the best possible results to our clients. That’s why we have over 288 5-star Reviews on Google!
Our team will help you save time and share over 40 years of industry knowledge and expertise to ensure you make a wise, well-informed decision.
Contact us today via phone at +613 8374 7652, or email us at admin@industryinsider.com.au, or text message at +613 402 346 810 to learn more about our services and how we can help you buy or sell.
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Industry Insider Property
Level 3, 489 Toorak Road, Toorak 3142
+613 8374 7652
+613 402 346 810
industryinsider.com.au
